Tracking Changes In Confections

While a few big gum and mint brands have the cache—and steady sales—to merit prime display space, hordes of newcomers are trying to snare a share of this valuable retail real estate.

By Marilyn Odesser-Torpey, Associate Editor

In its “New Product Pacesetters”report, research firm SymphonyIRI Group revealed that the gum and mint sector accounted for 19% of successful new product launches last year, more than double the category’s average share for the past decade. So it just stands to reason that retailers have had to hone their juggling skills to keep up with what’s new and hot in this category.

Scott Zaremba, president of Lawrence, Kan.-based Zarco 66 stores, relies on his distributors to keep him abreast of current category sales leaders in the overall U.S. market and locally in the Midwest. But the brands and flavors that are the most popular globally may not always the most profitable picks for all of his eight stores.

“We use overall market trends as our starting point but, since each of our stores serves a distinct demographic with its own individual preferences and purchasing patterns, each is its own niche market,” he said. “We have to keep a close eye on which products are selling and which are not on a store-by-store basis.”

Tom Mousaw, general manager of Colorado Springs-based Acorn Food Stores, looks to research data from Nielsen research along with manufacturer recommendations to determine what products he should carry.

“Normally, we’re to ready jump on all new items that are brought to us by manufacturer reps to make sure we keep up with what our customers might want to try,” Mousaw said. “But we expect the manufacturers to work with us by supplying smaller drops and shippers so we can easily determine the sell-through before we add any product to our major set.”

To keep the product assortment fresh, yet under control, the addition of any new item triggers a review of the entire set and removal of underperformers, Mousaw said.

Finding What Works

For Tim Cote, vice president of marketing for Beaverton, Ore.-based Plaid Pantries Inc., decisions about which products deserve a place in his core mix are driven by a two step process.

“Step one is determining the top-selling brand families in our market,” Cote said. “Step two is seeing which of those brands are willing to align their go-to market strategies most closely to our own.”

These days, he said, making sure the price is right is a priority. Since gum has become so price sensitive, Plaid Pantry’s strategy has become very promotionally driven with aggressive couponing, buy-one-get-one-free offers and attractive introductory price points.

Cote pointed out that $1 is now the upper price point consumers expect to pay for most gum products.

“The grocery channel comes in at or below this price on a significant number of SKUs, so consumers react pretty negatively when we are not at or under that as well,” he said.

Therefore, he said, the company is most responsive to manufacturers who make it possible for its stores to be very competitive with grocery store pricing, or allow them to price-promote at levels similar to the drug class trade.

“Some brands have been better than others about working with us on price promotion,” he noted. “The ones that do this best make up our core assortment and get most of the feature placement in our stores.”

Cote rotates new items in and out four times a year to coincide with manufacturers’ product introductions. Every new gum and mint variety gets at least a trial run to gauge customer response.

“We take in lots of in-and-out counter units,” Cote said.

Demand for Favorites

Most customers seem to make a beeline for familiar brands and flavors when they are looking for gum and mints, Zaremba said. According to the latest “State of the Snack Industry” report from SymphonyIRI Group, almost 40% of consumers demonstrate brand loyalty for non-chocolate products. If they are not already looking to purchase these items, they may not think about gum or mints at all.

Zaremba tries to plant the idea of an impulse purchase by placing standout displays of new products next to the register or in another separate location. This also gives these new products a chance to shine instead of being buried somewhere within the general assortment.

Zaremba’s merchandising strategy of featuring new gum and mint products in displays separate from the main set was supported by a convenience store in-store traffic study conducted by DHC. Placing these displays in usual destination spots, such as foodservice and beverage areas, has been shown to significantly boost impulse sales of gum and mints.

Perhaps even more surprising is the fact that some retailers are still missing major merchandising opportunities at the front counter, said Priya Baboo, president of Shopper Insights for Videomining, a provider of in-store intelligence for consumer product manufacturers and retailers.

“We still see retailers wasting prime front end display space on automotive cleaners and windshield wipers,” Baboo said. “If people want those items, they’ll go into the aisles to get them; that up front space should be reserved for well-stocked displays of impulse items.”

Wherever gum and mint displays are located within the store, Baboo urged retailers to keep track of which ones are actually inspiring customers to buy.

“It’s important to know where your customers are picking up their gum and mints, whether it’s at the front counter, a shelf in the candy aisle or a merchandiser somewhere else in the store,” she said. “With this information, retailers can know which displays generate the most and the least impulse sales, as well as whether and where changes should be made.”

Online Partners

Browse the latest issue of Convenience Store Decisions and back issues in an easy to use high quality format. Bookmark, share and interact with the leading C-Store magazine today.

Convenience Directions

The Convenience Directions concept has been in place for over 15 years in the convenience store industry. What we do is very unique in that
we combine the InfoMarketing newsletter, which is mailed quarterly to over 10,000 c-store executives, with three Idea Exchange meetings.

Print Subscription

NAG Convenience Conference

The National Advisory Group (NAG) is a dues paying association committed to building relationships and profits. NAG’s mission is to provide retail leaders of small to mid-size and family-owned convenience chains a peer-to-peer forum for the exchange of ideas to improve their business performance.